Note The table above is updated before publication with the latest consensus forecasts. However, the text charts are prepared ahead of time. Therefore there can be discrepancies between the forecasts given in the table above and in the text charts.
Rates as of 0500 GMT
OPEC took a lesson from the EU and kicked the oil can down the road. The group couldnt decide whether to increase production by 1.9mn barrels a day bd as scheduled from 1 January or to delay the production hike for three months as had been widely expected before the meeting. So they decided to raise output by 500k bd in January and then hold meetings every month to decide what to do. Each month they will be able to raise or, significantly, to lower production by 500k bd, depending on the market.
This decision was difficult and took several more days of negotiation than had been expected, as some producers wanted to increase production while others were worried about upsetting the fragile balance in the market. The group therefore seems to be setting itself up for just a string of difficult meetings every month.
But the agreement does have some advantages. First off, the 500k increase in output in January, while more than the zero increase that had been expected going into the meeting, should still keep the oil market in deficit. Secondly, having monthly meetings will allow them to react in real time to developments in an uncertain market, which has its advantages, especially since…